For Compound Taxes, the total cost of a product or service is taxed at one rate and then that amount (cost + tax) is taxed at a different rate and so on. In Oval Accounting we have added the functionality to allow this to happen and this can be configured accordingly based upon a Countries specific tax rules.
The configuration is done in Oval Administration under the Tax Rates tab. In here you can create as many tax rates as you need and you can also apply tax rate components which provides the ability to be able to specify whether this is a compound tax rate. The order in which the tax is applied can also be set.
The Tax Rates tab displays a list of tax rates that can be selected when creating transactions :
If you click on New you can create a new Tax Rate:
Once the Tax Rate has been created, you then have the ability to add the Components :
For each component you can specify the order the rate should be applied, the percentage and also whether it is a compound rate:
Once these have been created you can then select the tax rate to use when creating transactions.
If you would like to find out more about Compound Tax Rates or indeed Oval Accounting in general, please contact us at email@example.com.